Id Holdings CorporationTSE: 4709

Consolidated Financial Results for the First Nine Months of the Fiscal Year Ending March 31, 2026 (J-GAAP)

· Issued by ID Holdings Corporation

Note: This document is an English translation of the "Kessan Tanshin" for the third quarter of the fiscal year ending March 31, 2026 and is provided solely for reference purposes. In the event of any inconsistency between the Japanese and English versions, the Japanese version will govern.



Consolidated Financial Results for the First Nine Months of the Fiscal Year Ending March 31, 2026 (J-GAAP)

January 30, 2026

Company name: ID Holdings Corporation

Listing: Tokyo Stock Exchange, Prime Market

Securities code: 4709

URL: https://www.idnet-hd.co.jp

Company representative: Masaki Funakoshi, President, Representative Director and Group CEO

Direct inquiries to: Naoko Hara, Senior Corporate Officer Manager, Corporate Strategy Department Tel: +81 3-3262-5177

Scheduled date of dividend payment: －

Preparation of supplementary materials on financial results:

Yes

Presentation on results:

No

(Amounts of less than ¥1 million are truncated)

  1. Consolidated Financial Results for Q1-3 FY2025 (April 1-December 31, 2025)
    1. Consolidated Business Results (% indicates YoY changes)

      Net sales

      EBITDA

      Operating income

      Ordinary income

      Net income attributable to owners

      of parent

      ¥ million

      %

      ¥ million

      %

      ¥ million

      %

      ¥ million

      %

      ¥ million

      %

      Q1-3 FY2025

      29,188

      9.7

      3,308

      0.2

      3,018

      7.6

      3,036

      4.8

      1,939

      12.4

      Q1-3 FY2024

      26,602

      10.4

      3,303

      26.7

      2,805

      30.3

      2,897

      29.5

      1,724

      29.7

      Note: Comprehensive income Q1-3 FY2025 ¥2,274 million (3.6%) Q1-3 FY2024 ¥2,195 million (27.4%)

      EPS before amortization of goodwill

      Net income per share

      Diluted net income per share

      ¥

      %

      ¥

      ¥

      Q1-3 FY2025

      123.75

      0.8

      114.79

      -

      Q1-3 FY2024

      122.80

      23.1

      102.92

      -

      Note: Diluted net income per share is not listed, as the Group has no potential shares.

    2. Consolidated Financial Position

      Total assets

      Net assets

      Equity ratio

      ¥ million

      ¥ million

      %

      As of December 31, 2025

      22,667

      14,645

      64.3

      As of March 31, 2025

      22,490

      13,615

      60.3

      Reference: Equity As of December 31, 2025 ¥14,574 million As of March 31, 2025 ¥13,554 million

  2. Dividends

    Annual dividends

    End of first quarter

    End of second quarter

    End of third quarter

    End of fiscal period

    Total

    ¥

    ¥

    ¥

    ¥

    ¥

    FY2024

    -

    25.00

    -

    45.00

    70.00

    FY2025

    -

    35.00

    -

    FY2025 (forecast)

    35.00

    70.00

    Note: Revision of most recently published dividend forecast: No

  3. Forecasts of Consolidated Results for FY2025 (April 1, 2025-March 31, 2026)

    (% indicates YoY changes)

    Net sales

    EBITDA

    Operating income

    Ordinary income

    Net income attributable to owners of parent

    FY2025

    (full fiscal year)

    ¥ million

    %

    ¥ million

    %

    ¥ million

    %

    ¥ million

    %

    ¥ million

    %

    39,000

    7.5

    4,540

    3.4

    4,100

    8.4

    4,080

    5.6

    2,500

    4.6

    EPS before amortization of goodwill

    Net income per share

    FY2025

    (full fiscal year)

    ¥

    %

    ¥

    159.70

    -3.5

    147.77

    Note: 1. Revision of most recently published results forecast: No

    2. The consolidated earnings forecasts for "EPS before amortization of goodwill" and "net income per share" do not reflect the impact of the stock split resolved at the Board of Directors' meeting held on January 30, 2026. For details of the stock split, see page 12, "(3) Notes on Consolidated Financial Statements (Material Subsequent Events)."

    *Notes

    1. Significant changes in the scope of consolidation during the period: No

    2. Adoption of special accounting treatments for quarterly consolidated financial statements: No

    3. Changes in accounting policies, changes in accounting estimates and restatements:

      1. Changes in accounting policies due to revisions of accounting standards, etc.: No

      2. Changes in accounting policies other than (i): No

      3. Changes in accounting estimates: No

      4. Restatements: No

        As of December 31, 2025

        17,229,712shares

        As of December 31, 2024

        17,229,712shares

        As of December 31, 2025

        242,597shares

        As of December 31, 2024

        437,641shares

        Q1-3 FY2025

        16,895,876shares

        Q1-3 FY2024

        16,760,802shares

    4. Number of shares outstanding (common stock)

      1. Number of shares outstanding (inclusive of treasury stock):

      2. Amount of treasury stock:

      3. Interim average number of shares

        (Consolidated total for the quarter)

    5. Calculation of certain management indices

  • EBITDA = Operating income + depreciation + amortization of goodwill

  • EPS before amortization of goodwill = Net income after adjustments*÷ interim average number of shares

*Net income after adjustments = Net income attributable to owners of parent + amortization of goodwill

* Review of the attached quarterly consolidated financial statements by a certified public accountant or audit corporation: No

* Qualitative information relating to the appropriate use of results forecasts, and other noteworthy items

Results forecasts are estimates based on information available as of the day the results were announced. Forecasts are inherently uncertain. The actual results, etc. may be different from the forecasts because of changes in business conditions, etc. See (3) Qualitative Information on the Consolidated Results Forecast under Section 1. Summary of Business Results, etc., on page 6 of the Attachment for the assumptions that form the basis of results forecasts and other things to remember when relying on results forecasts.

The ID Group has also introduced a board benefit trust-restricted stock (BBT-RS) plan and Japanese employee stock ownership plan - restricted stock (J-ESOP-RS). Company shares held by Custody Bank of Japan, Ltd. (Trust Account E) as trust property for the BBT-RS and J-ESOP-RS plans are included in treasury stock.

Contents

  1. Summary of Business Results, etc. .- 2 -

    1. Summary of Business Results for the Period ...............................................................- 2 -

    2. Summary of Financial Condition for the Period...........................................................- 6 -

    3. Qualitative Information on the Consolidated Results Forecast ...................................- 6 -

  2. Consolidated Financial Statements and Important Notes .................................................- 7 -

    1. Consolidated Balance Sheet ..........................................................................................- 7 -

    2. Consolidated Statement of Income and Comprehensive Income .................................- 9 -(Consolidated Statement of Income)....................................................................................- 9 -

      (Consolidated Statement of Comprehensive Income) .......................................................- 10 -

    3. Notes on Consolidated Financial Statements.............................................................- 11 -

(Notes on Assumptions Regarding Going Concern) ..........................................................- 11 -(Notes on Significant Changes (If Any) in Shareholders' Equity) ....................................- 11 -(Notes on Consolidated Balance Sheet).............................................................................- 11 -

(Notes on Consolidated Cash Flow Statement).................................................................- 11 -

(Notes on Segment Information, etc.)................................................................................- 11 -

(Additional Information)....................................................................................................- 12 -

(Material Subsequent Events)...........................................................................................- 12 -

  1. ‌Summary of Business Results, etc.
    1. ‌Summary of Business Results for the Period

      During the consolidated cumulative third quarter under review (Q1-3 FY2025: April 1 to December 31, 2025), the Japanese economy continued on a gradual recovery keynote, thanks to improvements in the employment and income environments as well as the results of some government policies. However, the path forward remained unclear, due to factors such as the impact of a continuing rise in the cost of living on personal consumption, uncertainty arising from US trade policy and intensifying geopolitical risk. Moreover, the impact of fluctuations in financial and capital markets remained in focus.

      The information services industry, in which the ID Group is a participant, continued on a growth trend. Demand for IT investment continued to be robust, as digital technologies advanced in virtually every aspect of society. Corporate demand for AI, cloud solutions and other technologies that boost productivity and solve management issues drove growth in needs for construction of in-house IT environments and consulting. Cyberattacks aimed at corporate supply chains increased, intensifying appetite for investment in security measures and IT governance to ensure business continuity.

      Against this background, the ID Group enjoyed favorable growth in application development, IT infrastructure and cybersecurity. Net sales rose to ¥29.188 billion (+9.7% YoY). In earnings, the Group ramped up returns to employees and strategic investments to train and retain personnel, amid the increase in net sales noted above, improvement in gross profit margin, and decrease in amortization of goodwill. Operating income rose to ¥3.018 billion (+7.6% YoY) and ordinary income increased to ¥3.036 billion (+4.8% YoY). Net income attributable to owners of parent grew to ¥1.939 billion (+12.4% YoY) and EBITDA improved to

      ¥3.308 billion (+0.2% YoY).

      Note: Beginning with the consolidated first quarter under review, the service named "software development" is changed to "application development" and the service named "cybersecurity, consulting and training" is split into two services, "cybersecurity" and "consulting and training." These changes in nomenclature do not denote any change in the nature or status of these businesses.

      The Group's business consists of a single segment. Business results for each service are as follows.

      (Millions of ¥)

      Previous consolidated cumulative third quarter (April 1, 2024 to

      December 31, 2024)

      Consolidated cumulative third quarter under review

      (April 1, 2025 to

      December 31, 2025)

      Compared with same period of previous fiscal year (YoY)

      Increase/ decrease

      Rate of increase/

      decrease (%)

      System management

      Net sales

      11,304

      11,593

      288

      2.6

      Gross profit

      2,739

      2,713

      -25

      -0.9

      Gross profit margin

      24.2%

      23.4%

      -0.8P

      -

      Software development

      Net sales

      9,113

      10,215

      1,102

      12.1

      Gross profit

      1,843

      2,701

      857

      46.5

      Gross profit margin

      20.2%

      26.4%

      6.2P

      -

      IT infrastructure

      Net sales

      3,012

      3,491

      478

      15.9

      Gross profit

      914

      895

      -19

      -2.1

      Gross profit margin

      30.4%

      25.6%

      -4.8P

      -

      Cybersecurity

      Net sales

      1,570

      2,268

      698

      44.5

      Gross profit

      429

      678

      249

      58.1

      Gross profit margin

      27.3%

      29.9%

      2.6P

      -

      Consulting and training

      Net sales

      1,275

      1,187

      -87

      -6.8

      Gross profit

      550

      489

      -61

      -11.2

      Gross profit margin

      43.2%

      41.2%

      -2.0P

      -

      Others

      Net sales

      327

      431

      104

      31.9

      Gross profit

      -34

      -17

      17

      -

      Gross profit margin

      -

      -

      -

      -

      Total

      Net sales

      26,602

      29,188

      2,586

      9.7

      Gross profit

      6,442

      7,460

      1,017

      15.8

      Gross profit margin

      24.2%

      25.6%

      1.4P

      -

      1. System management

        Although some projects were scaled back and changes to service categories pared revenues, order acceptance from clients in the financial sector and major IT vendors expanded, new projects were launched, and a review of unit prices to ensure appropriate pricing also contributed to results. Net sales rose to ¥11.593 billion (+2.6% YoY).

      2. Software development

        The Group attracted new clients through partnerships with major IT vendors, launched new projects with existing clients, and enjoyed increases in order acceptance from clients related to finance, manufacturing, and energy. Net sales grew to ¥10.215 billion (+12.1% YoY).

      3. IT infrastructure

        Order acceptance increased with clients related to finance, energy, and manufacturing, while transactions expanded through partnerships with major IT vendors. Net sales improved to ¥3.491 billion (+15.9% YoY).

      4. Cybersecurity

        As demand for cybersecurity solutions intensified, order acceptance broadened with multiple clients, most notably in the public

        sector. Net sales surged to ¥2.268 billion (+44.5% YoY).

      5. Consulting and training

        Projects with some clients wrapped up. Net sales retreated to ¥1.187 billion (-6.8% YoY).

      6. Others

        Order acceptance from clients related to finance and energy expanded. Net sales lifted to ¥431 million (+31.9% YoY).

        Management Policy Initiatives

        The ID Group has drafted a three-year Mid-term Management Plan entitled "Next 50 Episode III: JUMP!!!," with FY2025 as its first year. Focusing on two strategic themes, "shift to a high-profit model" and "transformation of culture," the plan outlines six key strategies, including a service portfolio strategy, establishment of customer contact points and a strategy for investment in human capital.



        Note: Target figures as of April 30, 2025

        In its service portfolio strategy, the ID Group posted ebullient growth through its twin strategies of improving profitability in its base areas1and expanding the scale of operations in its focal areas2. In application development in particular, in which profitability has been identified as an issue, reforms were undertaken with a view to improving earnings at each business location. Going forward, the Group aims to improve profitability by establishing a high-productivity business model.

        In focal areas, over the past three years the Group has confirmed a number of employees who wish to rotate into different areas. For these employees, the Group worked to execute a planned resource shift into IT infrastructure and cybersecurity, and moved forward with training plans for consultants of whom advanced knowledge and experience will be required.

        Additionally, the Group continued to implement actions originally prepared for the strategy for investment in human capital, global strategy, and other initiatives.

        Notes

        1. Base areas: System management and application development

        2. Focal areas: IT infrastructure, cybersecurity, and consulting and training

        Research and Development Activities

        During Q1-3 FY2025, Group expenditures on research and development activities totaled ¥160 million.

        The ID Group is focusing intensively on research and development, determined to create innovative businesses that put state-of-the-art technologies to work.

        The ID Group undertook a number of major initiatives. The Group moved actively forward on research in AI technology. In particular, the Group focused on research on AI agents that can process complex tasks with high degrees of autonomy and examined and implemented development standards predicated on the assumption that AI will be used in system development. In addition, Group technical research continued on small language models (SLMs), which have high affinity with corporate security management, and on medical AI systems for diagnosis of knee osteoarthrosis, in collaboration with Tottori University. Leveraging this knowledge, the Group launched a series of innovative training programs and services. These included Dify Training from Scratch, a training program in which even AI beginners can quickly acquire skills useful in the working world; and the AIOps Status Analysis Service and the AIOps Product Introduction Service, two services aimed at supporting the introduction of AIOps1.

        The ID Group continued to work on constructing next-generation system operations incorporating advanced technologies to enhance system management, a core business of the Group. In one of these projects, ID-VROP, a virtual operation center, the Group examined fortification of security features using AI features and its patented blockchain technology, and tested technologies in view of proof-of-concept results in particular client environments. The Group also participated in a consortium to achieve next-generation system operations.

        The Group also pursued R&D applying patented technologies that the Company holds or intends to acquire. In collaboration with SBI R3 Japan Co., Ltd., the Group continued to advance research and development to achieve innovative services using a logging system and a technology to prevent hallucinations2.

        Finally, the Group took steps to strengthen its technical capabilities and foster further innovation. Through investment in US venture funds, the ID Group strengthened efforts to gather information on leading-edge technologies. The Group stepped up efforts to acquire certification under ISO42001, the international standard for artificial intelligence management systems (AIMS), and ISO56001, the international standard for innovation management systems.

        1. AIOps: A method of automating and streamlining system operation tasks using AI

        2. Hallucination: A phenomenon in which AI generates information that is not grounded in reality.

    2. ‌Summary of Financial Condition for the Period

      (Assets)

      Assets at the end of consolidated Q3 FY2025 increased by ¥177 million from the end of the previous fiscal year, to ¥22.667 billion. Cash and deposits decreased by ¥360 million and amortization of goodwill reduced assets by ¥151 million. However, contract assets rose by ¥375 million and investment securities by ¥231 million.

      (Liabilities)

      Liabilities at the end of consolidated Q3 FY2025 decreased by ¥852 million from the end of the previous fiscal year, to ¥8.022 billion. Other current liabilities rose by ¥728 million and contract liabilities increased by ¥423 million, but interest-bearing debt declined by ¥950 million, income taxes payable fell by ¥902 million, and provision for bonuses retreated by ¥213 million.

      (Net Assets)

      Net assets at the end of consolidated Q3 FY2025 increased by ¥1.029 billion from the end of the previous fiscal year, to

      ¥14.645 billion. Although payment of year-end and interim dividends reduced net assets by ¥1.376 billion, net income attributable to owners of parent increased by ¥1.939 billion, valuation difference on available-for-sale securities rose by ¥172 million, and foreign currency translation adjustment increased by ¥127 million.

    3. ‌Qualitative Information on the Consolidated Results Forecast

      There are no changes to the forecast of business results in "Notice Regarding Revision of Forecast of the Full-year Consolidated Business Results," published on October 31, 2025.

  2. ‌Consolidated Financial Statements and Important Notes
    1. ‌Consolidated Balance Sheet

      (Thousands of ¥)

      Previous consolidated accounting period

      As of March 31, 2025

      Consolidated third quarter under review

      As of December 31, 2025

      Assets

      Current assets

      Cash and deposits

      5,683,280

      5,322,553

      Accounts receivable-trade

      6,902,201

      7,058,829

      Contract assets

      975,713

      1,350,834

      Work in process

      109

      15,743

      Accounts receivable-other

      28,912

      59,815

      Other

      805,830

      849,002

      Total current assets

      14,396,048

      14,656,780

      Non-current assets

      Property, plant and equipment

      1,463,168

      1,450,519

      Intangible assets

      Goodwill

      475,828

      324,374

      Software

      88,303

      67,351

      Other

      754

      754

      Total intangible assets

      564,886

      392,480

      Investments and other assets

      Investment securities

      4,664,007

      4,895,777

      Deferred tax assets

      651,589

      447,806

      Guarantee deposits

      371,700

      366,082

      Other

      386,411

      465,576

      Allowance for doubtful accounts

      -7,500

      -7,500

      Total investments and other assets

      6,066,209

      6,167,743

      Total non-current assets

      8,094,264

      8,010,743

      Total assets

      22,490,312

      22,667,523

      (Thousands of ¥)

      Previous consolidated accounting period

      As of March 31, 2025

      Consolidated third quarter under review

      As of December 31, 2025

      Liabilities

      Current liabilities

      Accounts payable-trade

      1,378,584

      1,448,103

      Contract liabilities

      673,293

      1,096,431

      Short-term loans payable

      * 1,800,000

      * 1,000,000

      Current portion of long-term loans payable

      150,000

      -

      Income taxes payable

      1,132,988

      230,867

      Provision for bonuses

      1,443,365

      1,230,098

      Provision for directors' bonuses

      44,593

      23,330

      Other

      1,365,111

      2,093,848

      Total current liabilities

      7,987,936

      7,122,679

      Non-current liabilities

      Deferred tax liabilities

      494,495

      573,832

      Provision for directors' retirement benefits

      45,351

      52,146

      Net retirement benefit liability

      36,620

      27,237

      Other

      310,503

      246,588

      Total non-current liabilities

      886,969

      899,803

      Total liabilities

      8,874,905

      8,022,483

      Net assets

      Shareholders' equity

      Capital stock

      592,344

      592,344

      Capital surplus

      541,475

      541,475

      Retained earnings

      11,119,125

      11,682,146

      Treasury stock

      -427,649

      -293,774

      Total shareholders' equity

      11,825,295

      12,522,192

      Accumulated other comprehensive income

      Valuation difference on available-for-sale securities

      1,298,070

      1,470,748

      Deferred gains or losses on hedges

      648

      23,830

      Foreign currency translation adjustment

      412,769

      539,901

      Remeasurements of retirement benefit plans

      17,374

      18,231

      Total accumulated other comprehensive income

      1,728,863

      2,052,712

      Non-controlling interests

      61,247

      70,135

      Total net assets

      13,615,406

      14,645,040

      Total liabilities and net assets

      22,490,312

      22,667,523

    2. ‌Consolidated Statement of Income and Comprehensive Income ‌(Consolidated Statement of Income)

      (Thousands of ¥)

      Previous consolidated cumulative third quarter

      (April 1, 2024 to

      December 31, 2024)

      Consolidated cumulative third quarter under review

      (April 1, 2025 to

      December 31, 2025)

      Net sales

      26,602,545

      29,188,830

      Cost of sales

      20,159,728

      21,728,115

      Gross profit

      6,442,817

      7,460,714

      Selling, general, and administrative expenses

      3,637,170

      4,441,883

      Operating income

      2,805,646

      3,018,831

      Non-operating income

      Interest income

      10,037

      5,935

      Dividend income

      40,434

      47,095

      Subsidy income

      7,057

      4,701

      Foreign exchange gains

      6,031

      22,601

      Other

      41,017

      30,619

      Total non-operating income

      104,578

      110,954

      Non-operating expenses

      Interest expenses

      10,975

      12,537

      Share of loss of entities accounted for using equity method

      -

      67,157

      Other

      1,974

      13,469

      Total non-operating expenses

      12,949

      93,164

      Ordinary income

      2,897,275

      3,036,620

      Extraordinary income

      Gain on sales of non-current assets

      2,280

      -

      Gain on sales of investment securities

      -

      12,084

      Gain on sale of businesses

      -

      35,000

      Total extraordinary income

      2,280

      47,084

      Extraordinary losses

      Loss on retirement of non-current assets

      1,790

      319

      Total extraordinary losses

      1,790

      319

      Net income before income taxes

      2,897,764

      3,083,385

      Income taxes-current

      948,900

      938,301

      Income taxes-deferred

      214,271

      194,449

      Total income taxes

      1,163,172

      1,132,750

      Net income

      1,734,592

      1,950,634

      Net income attributable to non-controlling interests

      9,642

      11,160

      Net income attributable to owners of parent

      1,724,949

      1,939,473

      ‌(Consolidated Statement of Comprehensive Income)

      (Thousands of ¥)

      Previous consolidated cumulative third quarter

      (April 1, 2024 to

      December 31, 2024)

      Consolidated cumulative third quarter under review

      (April 1, 2025 to

      December 31, 2025)

      Net income

      1,734,592

      1,950,634

      Other comprehensive income

      Valuation difference on available-for-sale securities

      408,090

      169,178

      Deferred gains or losses on hedges

      8,124

      23,182

      Foreign currency translation adjustment

      41,685

      122,851

      Remeasurements of retirement benefit plans

      2,606

      857

      Share of other comprehensive income of entities

      accounted for using equity method

      -

      7,779

      Total other comprehensive income

      460,506

      323,848

      Comprehensive income

      2,195,099

      2,274,483

      (Breakdown)

      Comprehensive income attributable to owners of parent

      2,185,456

      2,263,322

      Comprehensive income attributable to non-controlling interests

      9,642

      11,160

    3. ‌Notes on Consolidated Financial Statements (Notes on Assumptions Regarding Going Concern)‌

None.

‌(Notes on Significant Changes (If Any) in Shareholders' Equity)

None.

‌(Notes on Consolidated Balance Sheet)

To improve the flexibility and efficiency of its fundraising, the Group has concluded overdraft agreements with five of its correspondent banks.

The Group's balance of unexecuted loans payable based on the above agreement is as follows.

Previous consolidated accounting period Consolidated third quarter under review As of March 31, 2025 As of December 31, 2025

Maximum amount of overdraft ¥6,100,000 thousand ¥4,100,000 thousand

Balance of executed loans payable ¥1,800,000 thousand ¥1,000,000 thousand

Difference ¥4,300,000 thousand ¥3,100,000 thousand

‌(Notes on Consolidated Cash Flow Statement)

The Group has not prepared consolidated cash flow statement for the consolidated cumulative third quarter under review. However, depreciation (including amortization of intangible assets other than goodwill) and amortization of goodwill for the consolidated cumulative third quarter are as follows.

Previous consolidated cumulative third

quarter

(April 1, 2024 to December 31, 2024)

Consolidated cumulative third quarter

under review

(April 1, 2025 to December 31, 2025)

Depreciation ¥164,802 thousand ¥138,531 thousand

Amortization of goodwill ¥333,352 thousand ¥151,453 thousand

‌(Notes on Segment Information, etc.)

[Segment Information]

The Group has only one segment, "information service business." Accordingly, this item is omitted.

‌(Additional Information)

(Trades involving the delivery of Company shares to employees, etc. through a trust)

The ID Group introduced two performance pay plans: a performance-based stock remuneration plan called a "board benefit trust (BBT) plan," for Group directors and corporate officers ("Directors, etc."), and a stock remuneration plan called a "Japanese employee stock ownership plan - restricted-stock (J-ESOP-RS)," for Group employees. The plans are designed to encourage Directors, etc. and employees to contribute to better mid- to long-term results and greater corporate value. At the 57th Annual General Meeting of Shareholders, convened on June 20, 2025, shareholders approved a shift from BBT to a "board benefit trust-restricted stock" (BBT-RS) for Directors, etc. of ID Holdings and major Group subsidiaries. Under this plan, the stock granted to the Directors, etc. is subject to transfer restrictions until the Directors, etc. retire.

  1. How the plans work

    The BBT-RS is a performance pay plan under which Company shares are acquired through a trust using money contributed by the ID Group, and those Company shares are then awarded to Directors, etc. through the trust based on their job performance, etc. as stipulated by the Officer Stock Benefit Rules established by the ID Group. When Directors, etc. receive Company shares while still employed with the Group, before receiving the shares the Directors, etc. must conclude a transfer restriction agreement with the Company. This measure restricts the ability of Directors, etc. to transfer or otherwise dispose of Company shares acquired while employed with the Company before they retire. Shares awarded to Directors, etc., including shares to be awarded in the future, are acquired using funds from a previously established trust, and those shares are segregated and managed as trust property.

    Under the J-ESOP-RS, the ID Group awards shares to employees who satisfy certain conditions as stipulated under the Stock Benefit Rules previously established by the ID Group.

    The ID Group awards points to employees based on factors such as years of service and promotions, issuing Company shares to employees in proportion to accrued points, once they become eligible to receive the shares based on certain conditions. When employees receive the Company shares while still employed with the Group, before receiving the shares the employees conclude a transfer restriction agreement with the Company. This measure restricts employees' ability to transfer or otherwise dispose of Company shares acquired while employed with the Company before they retire. Shares awarded to employees, including shares to be awarded in the future, are acquired using funds from a previously established trust, and those shares are segregated and managed as trust property.

  2. Notes on the ID Group shares held in trust

Shares in the ID Group held by BBT-RS and J-ESOP-RS at the end of the consolidated third quarter under review are listed in the consolidated balance sheet under "Net Assets" as "Treasury Stock." The book value of these shares was ¥412,696,000 at the end of the previous consolidated fiscal period and was ¥278,124,000 at the end of the consolidated third quarter under review. The number of shares was 414,371 at the end of the previous consolidated fiscal period and was 216,978 at the end of the consolidated third quarter under review.

‌(Material Subsequent Events)

(Share Split and Related Revisions to Articles of Incorporation)

At the meeting of the Board of Directors convened on January 30, 2026, the Company resolved to conduct a share split and a related revision of the Articles of Incorporation, as follows.

  1. Purpose of share split

    The purpose of the share split is to reduce the price per unit of Company shares, to create an easier environment for investors to invest in the Company, improve the liquidity of Company shares and broaden the Company's shareholder class.

  2. Overview of share split

    1. Method of share split

      With Tuesday, March 31, 2026 as the record date, the common shares held by shareholders listed in the shareholder registry as of the end of that trading day will be split in a two-for-one split.

    2. Increase in number of shares resulting from the share split

      Number of shares issued before the share split 17,229,712 Increase in number of shares resulting from the share split 17,229,712 Number of shares issued after the share split 34,459,424

      Total shares issuable after the share split 108,000,000

    3. Schedule of share split

      Date of publication of record date Friday, March 6, 2026 (planned)

      Record date Tuesday, March 31, 2026

      Effective date Wednesday, April 1, 2026

    4. Impact on per-share information

      Information per share if the share split had been conducted on the first day of the previous consolidated fiscal year is as follows.

      Previous consolidated cumulative third quarter

      (April 1, 2024 to December 31,

      2024)

      Consolidated cumulative third quarter under review

      (April 1, 2025 to December 31,

      2025)

      Net income per share for the cumulative period

      ¥51.46

      ¥57.39

  3. Revisions to Articles of Incorporation related to the share split

    1. Reason for revisions to the Articles of Incorporation

      In tandem with the share split, the Company will revise the number of shares issued as listed in Article 6 of the Articles of Incorporation, in accordance with Article 184, Paragraph 2 of the Companies Act.

    2. Details of revisions to the Articles of Incorporation The details of the revisions are as follows.

      (Underlines indicate revisions.)

      Current Articles of Incorporation

      Revised Articles of Incorporation

      (Number of shares issuable)

      Article 6 The number of Company shares issuable is 54 million.

      (Number of shares issuable)

      Article 6 The number of Company shares issuable is 108 million.

    3. Schedule of revision of Articles of Incorporation

      Date of meeting of Board of Directors Friday, January 30, 2026 Effective date Wednesday, April 1, 2026

  4. Other

Revision of capital stock

The current share split incurs no revision of capital stock.

Company analysis